The material stores control account for a company for March looks like this： MATERIAL STORES CONTROL ACCOUNT $ $ Balance b/d 12,000 Work in progress 40,000 Suppliers 49,000 Overhead control 12,000 Work in progress 18,000 Balance c/d 27,000 79,000 79,000 Balance b/d 27,000 Which of the following statements are correct? (i) Issues of direct materials during March were $18,000 (ii) Issues of direct materials during March were $40,000 (iii) Issues of indirect materials during March were $12,000 (iv) Purchases of materials during March were $49,000
A、(i) and (iv) only
B、(ii) and (iv) only
C、(ii), (iii) and (iv) only
D、All of them
A、(i) and (iv) only
B、(ii) and (iv) only
C、(ii), (iii) and (iv) only
D、All of them
【参考答案及解析】
Statement (i) is not correct. A debit to stores with a corresponding credit to work in progress (WIP) indicates that direct materials returned from production were $18,000. Statement (ii) is correct. Direct costs of production are 'collected' in the WIP account- statement (iii) is correct. Indirect costs of production or overhead are 'collected' in the overhead control account. Statement (iv) is correct. The purchases of materials on credit are credited to the creditors account and debited to the material stores control account.Therefore the correct answer is C.
Statement (i) is not correct. A debit to stores with a corresponding credit to work in progress (WIP) indicates that direct materials returned from production were $18,000. Statement (ii) is correct. Direct costs of production are 'collected' in the WIP account- statement (iii) is correct. Indirect costs of production or overhead are 'collected' in the overhead control account. Statement (iv) is correct. The purchases of materials on credit are credited to the creditors account and debited to the material stores control account.Therefore the correct answer is C.